The mayor of Lawrence, Massachusetts, is facing federal charges after prosecutors accused him of diverting pandemic-era small-business relief money into his political campaign, personal tax obligations and real estate debts.
Mayor Brian DePena, 61, was arrested Friday following a federal investigation into his handling of Economic Injury Disaster Loan funds obtained through his tire business.
DePena faces wire fraud and money laundering charges. The allegations have not been proven in court, and he is presumed innocent unless convicted.
The federal government expanded the EIDL program during the COVID-19 pandemic to provide low-interest financing to businesses suffering economic harm. Prosecutors allege DePena obtained more than $1 million through his company, Tenares Tire Service Inc., but subsequently used substantial portions of that money for expenses unrelated to the business purposes permitted by the program.
“Mayor DePena was elected to be a leader for the City of Lawrence,” U.S. Attorney Leah B. Foley said. “He was looked up to and trusted by his constituents, but he betrayed that trust through his alleged corruption and lies.”
Foley said the arrest demonstrated the government’s determination to pursue suspected fraud even when an elected official is involved.
DePena, who served on the Lawrence City Council from 2016 until 2021, was elected mayor in November 2021 and reelected in November 2025.
The federal complaint traces the case back to May 2020, when DePena applied for an EIDL on behalf of Tenares Tire, an auto-service and tire business in Lawrence.
The Small Business Administration initially approved a $150,000 loan in June 2020. DePena later requested more money as the business faced cash-flow problems.
In April 2021, the SBA approved a modification increasing the loan by $350,000. Another modification followed in October 2021, bringing the total loan amount to $1.1 million.
Federal officials say DePena became increasingly concerned when he could not immediately access the additional money.
“Brother, call me, I’m in trouble. I don’t want to pressure you, but I don’t have time to wait for this loan. I’m in your hands,” DePena allegedly wrote in a Spanish-language message to a financial adviser, according to a translation cited by prosecutors.
“I know I’m bothering you a lot, but I have no other option,” another message allegedly stated. “Only you can give me what I need.”
What happened after the money became available is now at the center of the criminal case.
Prosecutors allege that between August and October 2021, DePena transferred nearly $90,000 from business accounts into personal accounts. He then allegedly wrote checks totaling more than $42,000 to “The Committee to Elect Brian DePena.”
Federal investigators also claim the money went toward considerably larger personal obligations.
According to the complaint, approximately $85,000 was used to settle DePena’s personal back taxes with the Internal Revenue Service. Another $883,293 allegedly went toward paying off high-interest mortgages on personal properties DePena owned in Lawrence.
Those expenditures would represent the overwhelming majority of the $1.1 million loan.
“CARES Act funds were created to help small businesses survive an unprecedented national crisis — not to bankroll personal debts, political ambitions, or real estate ventures,” said Thomas Demeo, special agent in charge of the IRS Criminal Investigation Boston Field Office.
Demeo said investigators remain focused on protecting federal relief money and pursuing people suspected of exploiting those programs.
The complaint also provides a striking picture of the current status of the loan.
As of Aug. 5, DePena had reportedly made 16 payments totaling $130,160. Because those payments were applied toward accrued interest, prosecutors say the outstanding balance has grown to approximately $1.65 million.
